Fla. Launches Sale Of Mega Millions Tickets

TALLAHASSEE, Fla. (AP) — No one is quite sure if the numbers will add up, but the Florida Lottery on Wednesday will start selling tickets to the popular Mega Millions lottery game.

Lottery officials are launching the multi-game state with a bit of a flash, even scheduling an opening day celebration at a Fort Myers convenience store. There are expectations that the game will be a big success, especially since last year it had a record payout for a lottery.

But Mega Millions isn’t a sure winner overall for the Florida Lottery.

There are lingering questions on how the sales will impact other lottery games — and how much more money it will generate for the state’s schools.

Players win by matching the five white ball numbers (1-56) and the golden Mega Ball number. Tickets cost $1 while tickets for Powerball now cost $2.

State economists have concluded that the addition of Mega Millions will result in reduced sales in both Powerball and Florida Lotto, which has been the flagship game for the Lottery for more than 20 years.

In the past, Florida lottery officials have resisted adding games such as Powerball or Mega Millions because of fears that it would eat into profits of other games. The decision to add Powerball in 2009 came during a time of declining sales.

Lottery Secretary Cynthia O’Connell said the prime reason for adding Mega Millions now is that customers in the state want it. She contends that potential lottery tickets buyers went into Georgia to buy tickets when last year’s jackpot exceeded $600 million.

“Our players wanted us to join,” O’Connell said on Tuesday. “There was a lot of pent up demand. We have millions of Floridians and millions of people who visit Florida. They like it and they want to have the opportunity to play it.”

She also called it the “final peg in the winning lineup of jackpot games.”

So far the Florida Lottery under O’Connell has seen outstanding growth.

Last summer the Florida Lottery wrapped up the most financially successful year in its history. The state-created lottery boosted its overall sales to $4.45 billion, an increase of more than $440million over the previous fiscal year.

The Lottery is on pace to shatter that record in the next few weeks and could even reach $5 billion in annual sales.

But a key component of that record growth has come in the form of scratch-off games not the so-called terminal games such as Powerball, Lotto, Fantasy 5 and Cash 3. The profit margin on scratch-off games tends to be less than the profit on terminal games.

That’s why even with the increased sales economists in March estimated that the overall growth of money transferred to education programs from lottery tickets would increase just 2.37 percent during the state fiscal year that ends on June 30. Economists predict only 1.65 percent growth in the fiscal year that starts on July 1.

O’Connell acknowledged that one reason to add Mega Millions was to help the balance between the sales of terminal games and scratch-off games. She said that lottery officials will keep an eye on other games and won’t hesitate to boost marketing in an effort to help games such as Lotto.

“We need to be concerned about our entire portfolio,” O’Connell said.

Mega Millions has a starting jackpot of $12 million and drawings are held on Tuesday and Friday. Powerball has a starting jackpot of $40 million and drawings are held on Wednesday and Saturday.

Lottery officials estimate that Mega Millions will generate sales of roughly $209 million in its first year of operation – but that it will likely result in an 10.5 percent decline in Powerball ticket sales and an 8.5 percent decline in the sales of Florida Lotto tickets.

The decline of Powerball and Lotto ticket sales is expected to accelerate even further in 2014 and 2015 as Mega Millions takes off.